After my last post,
I was asked to look at this topic from the other side. What are the manufacturer best practices to entice distributors.?
Several manufacturers have asked me to develop better channel partner programs to improve their selling effectiveness. Manufacturers end game usually involves: increased sales, greater mind share and better branding (no small feat).
Channel partners are an efficient and less expensive way to enter a new market and have a local presence. They know the local prospective end users having sold them complementary products. They will also have built an internal supply chain process to support these end users.
Distributors or dealers want the respect and courtesy a manufacturer would give an end user customer (they are buying and selling from the manufacturer).
Distributors and dealers will want a manufacturing partner that:
Access to top management is also appreciated. They expect to be updated on the manufacturer strategy, product development and P&E investments. Distributors like to have frequent efficient joint visits with sales reps to display the partnership. Provide an organization chart within the manufacturer so that they contact key touch points e.g. credit, customer service, marketing staff and product managers is essential.
Most “model” suppliers today will have an online Web portal that provides product selection options, a product Configurator, 3D drawings, quoting, ordering, order tracking and delivery trafficking.
2. Has unique products that solve a customer problem
The product should be intuitive and have simple instructions for installation and operating instructions. They will want timely product development pipeline so that there is a spirit of innovation and “buzz.” Of course, product deliveries should be consistent and completed as promised. Any delay in delivery performance will detract from the overall product experience.
3. Has a global marketing strategy
80% of most new customer contact is now digital. Leads collection and dissemination has also gone digital and customer expectations are set for a rapid response. Seamless lead processing from the manufacturer is critical.
There of course must be on line and hard copy marketing collaterals and logos for 3rd party usage. There should be interactive selling tools e.g. video, application stories and end user testimonials. There also should be prepackaged demo cases to support local salespersons as well as quoting tools with quantitative ROI calculators. Local trade show kits need to be in easy to assemble/disassemble trade show kits with high quality display products.
4. Has regular on site and remote product training seminars
Most dealer/distributor sales reps carry multiple product lines-expect at least five major lines with a myriad of niche lines too! Product training should be visual, tactile and backed up with easily referenced product data. Application information and sales opportunities by market segment tells your partners where to look for new business-always important! Distributor salespersons live by selling something-they don’t get paid for training so make it worth their while.
Global distributor meetings can be a valuable venue for distributors to learn winning tactics from other of the supplier’s distributors. They build camaraderie with each other and an atmosphere of best practices for that particular manufacturer. In the past, I have learned more when the distributors participate and/or facilitate their own sales meeting within that meeting.
5. Has consistent pricing that rewards its partners for the time they give it.
They want a manufacturer that realizes that its channel partners need to make a profit so they can retain good salespersons and support staff. Incentives for achieving sales goals should be rewarded. Surcharges and small price increases usually cannot be passed forward to end users without notification so avoid implementing such regular programs to retain harmony within the channel.
What would your distributors say about your company?
What did I miss as good traits? What are you offering your distributors?
Just back from a relaxing trip to my home state of Maine to see Mom, enjoy an ocean boat ride with my sister Louise and attend Maine Trade Day http://www.mitc.com/. It was an inspirational trip and I was able to reflect on channel partnerships
We had the best response to date to our last blog about
the right distributor attributes http://www.jimthomasintl.com/blog/archives/05-2016 . The follow up question I have heard “Jim-I have a distributor that does not have that important attribute you described-how should we move forward?”
Don’t get discouraged. Time to look in the mirror at the partnership, the key questions are really:
You usually determine that you share some responsibility in getting off track. An honest mutual assessment and a heart to heart conversation (not an e-mail) should soon follow. I follow the simple 3T forward determination I borrowed and modified from my friend Mark Stump:
Make your decision about the 3 T’s and move forward.
I prefer to have a bias to action, but you need to two parties to commit to reform and all cannot be reformed. When is it OK to have a lower performing distributor that you put in the table category-you hold on and do not significantly invest in that distributor resource?
LESSON LEARNED: Stay positive and focus on continuous improvement. Always be looking for good bench strength and potential higher performing channel partners.
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